Insurance Industry Employment Figures Should Be A Wake Up Call
These insurance industry employment trends should sound off a few alarms. Recently, I was reading the July issue of AM Best’s Monthly Magazine.
The July Issue covers the Millennial paradox among other concerns. One of the article covers a very salient point. The industry employment threats abound now with the attrition and aging of the workforce versus the slow pace of the new hires.
One table on page 3 of the article stopped the show.
The numbers from the Baby Boomer’s Exit table*:
- 74% increase in the number of employees aged 55 and older in the last decade (ouch!)
- 25% of the insurance industry workforce consist of employees aged 35 or less.
- 50% of the industry workforce will be retired by 2030.
- 20% of experienced underwriters will retire in the next few years
- And the grande finale —are you ready for this one–-70% of insurance adjusters age > 40!
Let us cover those fascinating insurance industry employment numbers one more time.
The 74% number alone rings an alarm bell with me. I have just joined that group over the last year. Attending a safety and risk management conference a few years ago opened my eyes. No one under 40 showed up for the conference. Everyone was the same people I talked with and had seen over the last 20 years. There were no new faces.
The second bullet point aligns with the first one. I have experienced this at many conferences lately. Where was the younger crowd? I was told possibly that companies send only Senior level people to the conferences. I find that hard to believe. Why? When I attend conferences outside of the insurance industry, the 35 and younger attendees are out in force.
The third bullet point could be allayed with the fact that technology may replace some of the workforce. However, 50% coverage is an illusion.
The fourth bullet point shows the insurance underwriting industry losing 20% of the workforce. Once again, I have been told technology will replace much of this function. Twenty years from now this could possibly happen, but not in the next few years.
The fifth bullet point, which made me write this article, shows a real crisis in one area the insurance industry must heed – only 30% of the adjusters are under age 40. (Double ouch). I was informed once again that this shortfall can be withstood by the increase in technology. However, the insurance industry cannot make this ground as insurance seems to be far behind in technology. I have written many articles on the lack of the technology in Workers’ Compensation.
One wonders what the solution will be ten years from now.
*Credits should be given to McKinsey and Co., Insurance Careers movement, Bureau of Labor Statistics, The Jacobson Group, Deloitte, and The Institutes for the table as AM Best used them to create the table.
©J&L Risk Management Inc Copyright Notice